Matter of Board of Educ. v. Hauppauge Teachers Ass’n, 42 N.Y.2d 509 (1977)
An agreement to arbitrate disputes does not extend to matters for which a method of review is mandated by law, ensuring that statutory review processes are not circumvented by contractual arbitration clauses.
Summary
The Hauppauge Teachers Association sought to arbitrate a grievance concerning a teacher, Austin, who was also subject to disciplinary charges under Education Law § 3020-a. The school district sought a stay of arbitration, arguing that the disciplinary charges fell outside the scope of the arbitration agreement. The New York Court of Appeals held that because the grievance was the subject of a statutorily mandated disciplinary review process, it was excluded from the arbitration agreement, as the agreement excluded matters “for which a method of review is prescribed by law.” This decision underscores that arbitration clauses will not be interpreted to supersede mandatory statutory review processes.
Facts
The Hauppauge Union Free School District and the Hauppauge Teachers Association were parties to a collective bargaining agreement that included binding arbitration. Teacher Austin was charged with neglect of duty and misconduct for participating in a basketball tournament without permission and for prior absenteeism. Formal charges were filed against Austin under Education Law § 3020-a. Austin filed a grievance alleging a denial of personal leave and improper deduction of pay related to the basketball tournament incident. The Association demanded arbitration, seeking reimbursement of pay, cessation of denying personal leave, and rescission of disciplinary actions.
Procedural History
The School District moved to stay arbitration. Special Term denied the stay and directed arbitration. The Appellate Division reversed, granting the stay. The Court of Appeals granted leave to appeal.
Issue(s)
Whether the collective bargaining agreement between the school district and the teachers association evinced an express, direct, and unequivocal agreement to arbitrate a dispute that was the subject of disciplinary charges under Education Law § 3020-a, which provides a method of review prescribed by law.
Holding
No, because the arbitration agreement excluded disputes for which a method of review is prescribed by law, and the disciplinary charges against Austin were subject to a statutorily mandated review process under Education Law § 3020-a, thus falling within the exclusion.
Court’s Reasoning
The Court of Appeals emphasized that, under the Taylor Law, a court must find an “express, direct and unequivocal” agreement to arbitrate before compelling arbitration. The arbitration clause in this case was broad but contained an exclusion for matters with a legally prescribed method of review. The court recognized that a broad interpretation of the exclusionary language could nullify the arbitration agreement. To balance the inclusionary and exclusionary language, the court limited the exclusion to grievances for which review is “mandatorily” provided by statute or regulation. Because Education Law § 3020-a mandates a procedure for reviewing disciplinary charges against teachers, the court held that the grievance fell within both the inclusionary and exclusionary language of the arbitration agreement. The Court reasoned that “Having agreed to exclude certain otherwise includable disputes from their agreement to arbitrate, the parties must have intended this exclusion to have some effect.” It also noted that concerns about bad faith disciplinary charges used to avoid arbitration were not present here, as the charges preceded the grievance. Therefore, the court concluded that there was no express and unequivocal agreement to arbitrate the dispute.